Avoid These Common Mistakes Personal Representatives Make When Managing an Estate

Losing a loved one can be a heartbreaking and stressful time. It can become even more overwhelming if you’ve also been appointed the personal representative, also known as an executor, of the deceased’s estate. Making mistakes in handling this person’s estate can exacerbate the grieving process and expose the estate to litigation, increased tax liabilities, and other potentially serious consequences. All of these errors can cost heirs money they would have received as an inheritance. Mistakes personal representatives make

Don’t Make These Mistakes

If you are appointed the personal representative of an estate, you have a duty to wrap up the person’s affairs, pay the estate and income taxes, pay creditors, and distribute the remaining assets to the heirs. Often, many legal documents must be filed, and you may have to navigate many family emotions and issues. You can make the process smoother and prevent at least some family conflicts if you avoid these common mistakes that personal representatives often make:

  • Not educating yourself. If you do not understand how the probate process works, you cannot know the steps you need to take to properly probate the estate, the notices you are required to give, or the deadlines you must meet. This can result in mistakes that could require the estate to pay more in taxes and to creditors.
  • Not locating the deceased’s will quickly. One of your first steps is to locate the deceased person’s will. If he did not tell you where it is, you may need to search through his paperwork to find it. His will is crucial to telling you how to distribute his assets, and you will need to file it with the court to start the probate process.
  • Waiting too long to start the process. Even though you may want to take your time to grieve, you cannot afford to wait too long to start the probate process. Your loved one’s bills such as mortgages, utility bills, credit card debts, and taxes will need to be paid. You need to be appointed personal representative of the estate in order to gain control of your loved one’s assets and take steps to pay bills before penalties and interest charges increase or any real estate goes into foreclosure. In addition, heirs and creditors could become frustrated and less easy to work with if you wait too long to begin the probate process.
  • Not making an inventory of assets and debts. If you must probate your loved one’s estate, you need to collect all of his bills, so you understand his financial obligations. In addition, you need to make an inventory of his assets and their value. You will need this information to give proper notice to creditors that the estate is in probate and the deadline to file a claim; to file any required inventory of assets with the court; and to liquidate assets and pay heirs what they are entitled to.
  • Not securing estate assets. As executor of the estate, you have a duty to secure estate assets. This can include locking up the deceased person’s residence, so others cannot go in and take property, as well as limiting access to and closing financial accounts.
  • Failing to identify heirs. You are required to identify all legal heirs of the estate and notify them that you are probating the estate.
  • Not recognizing non-probate assets. Certain assets are not considered part of the probate estate and can be distributed to heirs immediately. These include life insurance policies, bank accounts, investment accounts, and other financial assets where the deceased listed beneficiaries of the asset. People often designate beneficiaries to avoid the asset having to go through probate and to ensure loved ones quickly receive this share of their inheritance.
  • Failing to give required notices. You are required to give notice of the probate estate to creditors, so they can file a claim for what they are owed. If you fail to give notice, you could extend the time period creditors have to make a claim and delay distributing the remaining assets to heirs.
  • Not paying taxes and other debts. The estate could owe federal and state taxes as well as other debts. By not paying them in a timely manner, there could be costly ramifications when you do finally pay them.
  • Not understanding real estate options. Real estate is often a large part of a loved one’s assets. You need to understand the options for selling the property—either to another heir or on the market—and for making repairs and paying for them if this could increase the property’s value. If the deceased person was behind in his mortgage, you may need to sell the property more quickly and for less money to avoid losing the property through foreclosure.
  • Not hiring an experienced attorney. While you may want to save the estate money, trying to probate the estate without the help of an experienced probate attorney can actually cost the estate money down the road. An attorney can prepare the legal paperwork you need to file with the court, ensure you do not miss critical deadlines, and guide you through the process so you fulfill your obligations as personal representative of the estate.

Let Us Help You Probate Your Loved One’s Estate

At Molly B. Kenny, our Bellevue estate planning attorneys have been helping clients probate estates for over two decades. Let us help you make this job easier, so you can fulfill your duties, reduce your stress, and make the process smoother and easier. Call our office at (425) 460-0550 to schedule a private consultation to learn how we can assist you.

 

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